Flag of Norway

Norway country brief

Overview

The Kingdom of Norway occupies the western and northern portions of the Scandinavian Peninsula in Europe, bordered by Sweden, Finland, and Russia.  It also shares sea borders with the UK and Denmark.  A rugged country of mountains, fjords, and glaciers, Norway covers an area of 385,155 square kilometres.  Norway also holds sovereignty over Bouvet Island in the South Atlantic Ocean.  Norway has a population of 5.0 million (2012) of which approximately 80,000 are Sami, an indigenous people living in Norway, Sweden, Finland and Russia.  Sami settlements are located mainly in the north of the country.  Having one of the world's highest per capita incomes, Norwegians enjoy a high standard of living, life expectancy, and overall health and housing standards.

Norway is not a member of the EU, having voted twice (1972 and 1994) not to join. Successive governments have, however, tried to establish the closest links possible with the EU through the European Economic Area (EEA) agreement. Norway has good access to the EU single market for most of its products through the EEA agreement and participates in regular consultations with the EU on a range of political, trade and security related issues. NATO is the cornerstone of Norway's security policy. Norway is also a member of numerous other international organisations including the United Nations, the Arctic Council, the Organisation for Security and Cooperation in Europe (OSCE), the World Bank, the International Monetary Fund (IMF) and the World Trade Organisation (WTO).

Political overview

Norway is a constitutional monarchy and parliamentary democracy with legislative powers vested in the Storting (parliament).  The Head of State is H.M. King Harald V, who acceded to the throne in 1991.  The Storting is made up of 169 members directly elected for four-year terms by proportional representation.  Parliamentary elections are mandatory every four years at specific dates.  The next elections are scheduled to be held in September 2013.  A constitutional amendment passed by the Storting in February 2007, which took effect following the 14 September 2009 elections, means that the Storting functions as a unicameral parliament, rather than dividing into two chambers to consider legislation as was previously the case.

The governing Centre-Left coalition (Labour, Socialist Left, and Centre Parties) was elected to government in 2005, and re-elected for another four years on 14 September 2009, winning 86 seats in the Storting.  The Government is led by Prime Minister Jens Stoltenberg.  The Labour Party, which has dominated the political scene in Norway since the 1930s, continues to be the largest party in the Parliament with 38 per cent of the seats.

Economic overview

Norway has an open economy with a floating exchange rate. Real GDP in Norway contracted by 1.4 per cent in 2009, before returning to positive annual growth of 0.2 per cent in 2010, 1.3 per cent in 2011 and 3.0 per cent in 2012.

Norway's emergence as a major oil and gas producer in the mid-1970s transformed its economy.  Norway's per capita income is one of the highest in the world due to the large influx of investment capital into its North Sea oil and gas fields and its substantial oil revenues.  The petroleum sector contributes over half of Norway's total export revenue.  All production activities take place off-shore in the North Sea and the Norwegian Sea.  To insure against the eventual depletion of its oil and gas resources, Norway has created the Norwegian Government Pension Fund Global. The Fund managed some 3,961 billion NKK (approximately A$700 billion) at the end of 2012, derived from royalties on the country's oil and gas reserves.  The fund is about the size as the national economy.

According to the Norwegian Government, Norway was  the world's fourteenth largest producer of oil and sixth largest producer of natural gas in 2011.  It has approximately half of the remaining reserves of oil and gas in Europe and, globally, is the seventh biggest oil exporter and third largest exporter of natural gas.  In 2011, Norway supplied 13 per cent of oil imports and over 30 per cent of gas imports to the EU.

Bilateral relationship

Norway is an important interlocutor for Australia on Antarctic issues.  A bilateral Working Holiday Maker arrangement came into effect in August 2001, and is a popular means for young Australians and Norwegians to experience each other's country.  A reciprocal health agreement came into effect in 2003.  A bilateral Social Security Agreement came into effect in January 2007.  A revised bilateral Double Taxation agreement entered into force in September 2007 (further information is available on the Australian Taxation Office website).

According to the 2011 census, over 23,000 Australians claim Norwegian heritage. The only significant areas of disagreement between Australia and Norway are whaling and Norway's high levels of agricultural protection.

Australia's Ambassador to Norway is based in Copenhagen, and there is an Honorary Consul in Oslo. Norway maintains an Embassy in Australia and there are Consulates in all States and in the Northern Territory.

High Level Visits

To Norway

The Minister for Resources, Energy and Tourism, the Hon. Martin Ferguson AM MP visited Norway in May 2009, and then Foreign Minister, the Hon. Stephen Smith MP visited in December 2008.

To Australia

The Norwegian Prime Minister, Jens Stoltenberg, visited Australia in December 2011 with a Norwegian Business Delegation focused on oil, gas and shipping.  The Norwegian Minister for the Environment and Development Cooperation, Mr Erik Solheim visited Australia in May 2008.

Bilateral economic and trade relationship

Total two-way merchandise trade between Australia and Norway in 2012 was A$465 million. Australia’s merchandise exports to Norway were valued at was A$179 million in 2012, and included alcoholic beverages, perfumery and cosmetics, specialised machinery and parts and ships and boats (including hovercrafts). Merchandise imports from Norway were valued at A$286 million in 2012, and included measuring and analysing instruments, telecom equipment and parts, arms and ammunition and cheese and curd.

Two-way trade in services was valued at A$767 million in  2012. Norwegian students are important to the Australian education sector with some 2,234 student enrolments in 2012.

Norway and Australia share common expertise in various industrial sectors, including clean energy, oil and gas, mining, chemicals, and marine and shipping.  This indicates a receptive market for Australian technology and expertise in these sectors.  There are a number of significant Norwegian companies with direct investments in Australia.  These include the Aker Group (oil and gas), Norsk Hydro (fertilisers and aluminium production), Wilhelm Wilhelmsen (shipping) and Dyno Wesfarmers (explosives).  

For advice on doing business in Norway, see Austrade’s website

Updated 4 March 2010.